Grain prices boost Senwes profits

Senwes announced a net profit after tax of R187 million for the first six months of the 2012/2013 fiscal year. This represented an increase of 65,5% compared to the R113 million profit for the same time the previous year.

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The turnover remained similar at R7,3 billion. Headline earnings increased by 6,7% from 66,9c/share to 71,4c/share. “Grain stock levels are still under pressure, which are expected to impact negatively on silo storage income. Should grain prices continue to trade above export parity, higher carry-over stock levels than in April 2012 are expected, which will offer a better business base for the coming financial year.

“We are expecting that the bullish run in respect of mechanisation will continue for the larger part of the remainder of the year. Good commodity prices and increased planting intentions predict a positive input year. However, exceptionally low or late rains could impact negatively on these predictions,” Senwes MD Francois Strydom said. AFGRI and Senwes in the meantime also announced the conclusion of a merger of their respective agri-retail businesses as well as AFGRI’s wholesale subsidiary, Partrite. Both companies will hold a 50% interest respectively. The transaction was subject to approval by the Competition Commission.

“In the current challenging business environment, where producers and consumers are under severe economic pressure, we do not only foresee value for our businesses, but the advantages of a larger and more sustainable business will also contribute towards relieving the pressure experienced by our client base,” said AFGRI CEO, Chris Venter. 

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